KL scraps unpopular fuel scheme

The Malaysian government has scrapped its plan to introduce a two-tiered fuel scheme that would have rationed subsidies and ended them altogether for some drivers, following negative feedback from the public.

Domestic Trade, Co-operative and Consumerism Minister Ismail Sabri Yaakob said that the government nixed the planned subsidy restructuring as it did not want to implement an important policy that did not have the people's support. Some analysts suggested that the move may mean that polls are imminent in the important East Malaysian state of Sarawak.

The government had wanted to introduce a management system for the fuel subsidy, as it felt the subsidy did not fully benefit the intended target groups and that even owners of foreign-registered vehicles were enjoying it. The plan, originally set to be implemented on May 1, was to introduce a tiered pricing system for petrol, depending on engine capacity, while foreigners would have to pay the market price.

Last December, the government announced that foreign registered vehicles would be allowed to pump only a maximum of 20 litres of fuel at petrol stations within a 50km radius of the border.